We all know the feeling of coming to the end of the month and wondering where all our money went. Setting a budget and sticking to it will help you prioritise what’s important. ‘Manage your money. Don’t let it manage you’, says Elmarie Samuel, Senior Technical Marketing Specialist at FMI (a division of Bidvest Life).
Here are some budgeting tips to help you manage your money:
1. Create a realistic budget.
The secret to sound money management is to pay yourself first. That means saving a percentage of your income each month and then using what’s left to pay the bills.
That way, you’ll have money available for those unforeseen expenses.
2. Get the insurance you need
Medical aid, life and car insurance aren’t luxuries. They’re your safety net when the unexpected happens. A financial adviser can help you choose options to suit your pocket and your needs.
3. Track your budget.
Tracking your spending is an essential part of creating a budget that works. It will help you spend more intentionally and avoid the temptation of impulse purchases. Simply make a note of everything you spend and compare it to your budget. This will give you a clear idea of where your money is going, and you’ll be able to either tweak your budget or adjust where you’re leaking money. Using a mobile budgeting app is an easy way to keep track of your spending.
4. Know the difference between bad credit and good credit.
Good credit is buying things on credit that you can afford and need, such as a house with a home loan. Bad credit is purchasing goods on credit that you can’t afford or need. Bad debt creates an endless downward spiral. If your salary is constantly being eaten away by debt repayments and high interest rates, you’ll soon find yourself with less and less money for essentials every month.
Setting a budget, prioritising what’s important and tracking your spending are the most important steps to managing your money effectively.
This article was supplied by FMI (a Division of Bidvest Life Ltd)
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